It’s been over a year since the Sustainable Finance Disclosure Regulation (SFDR) came into force, and yet many organizations are still struggling to align their data with the SFDR Principal Adverse Impacts (PAI) statement. The industry is still facing challenges in processing data from their current setups into the SFDR framework. Fortunately, the significant overlap between SFDR’s mandatory and optional indicators with other ESG frameworks—such as GRI, ISSB, SASB, INREV, and GRESB—has helped avoid an even larger reporting burden.
Leveraging an ESG data platform can substantially reduce the resources needed for this type of reporting. The platform streamlines data collection, helps map out the relevant indicators, and ensures consistency across various reporting requirements. Even if an organization has not been reporting according to other frameworks, platforms guide users through the required data, validating completeness, data coverage, and data quality. By mapping data directly with frameworks like the Partnership for Carbon Accounting Financials (PCAF), we make sure the industry is well-prepared for any audits or checks by regulators (which are expected to become more frequent and rigorous).
Having a solid ESG reporting process not only improves regulatory compliance but also addresses the growing scrutiny from institutional investors. Demonstrating best practices in data management reduces uncertainty, strengthens stakeholder confidence, and saves you time better spent on action.
Another challenge is aligning reporting under the EU Taxonomy, which has less overlap with other frameworks. However, for many real estate assets, this is closely tied to data like EU EPC labels. Keeping a consistent dataset across all these different reports is crucial, and this is where data plaforms excel. By maintaining data alignment and reducing the risk of errors or omissions, platforms help organizations navigate what’s often referred to as the ESG “acronym soup.”
The expertise of organizations like GRESB, ULI, EPRA, INREV NCREIF, NAREIT AREF, ANREV, GBCA and NABERS are crucial for this optimization. This combination allows the industry to provide both a powerful platform and the expertise needed to anticipate future (changing) frameworks and regulatory demands. (For instance, seeking alignment between the requirements of the UK SDR regime in advance of their anticipated rollout in 2026 and SFDR.) If we keep collaborating closely as an industry, real estate managers can spend less time collecting and reporting data and focus instead on execution-driving meaningful ESG outcomes such as decarbonisation retrofits.
However it’s really important for organisations to build a robust data architecture, user-friendly interface to get all stakeholders on the same page, and scalable support to help big real estate managers with over 1500 assets across the globe. But we should equally commit to smaller investors, working through partnerships with banks to bring the power of data to organizations of all sizes.
Whether you’re facing SFDR, EU Taxonomy, or any other ESG reporting requirement, this ensures you’re not just compliant, but prepared for the future. By reducing the resources spent on data collection and reporting, technology should empower you to focus on what really matters—executing your ESG strategy and making a real impact.
